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In the fable of Esopia, the grasshopper passes its summer song, its dance and its consumption. The diligent ant is moving away from storing food, despite the supplications of the grasshopper to join the pleasure. Winter goes down. Ants have a lot; The hollow -out hoop; The moral is so clear, even an insect can get it.
Or is it? Are there any circumstances where debauchery is forgiven, or do the evil prepared deserve their fate? Does civilization are progressing or stagnating when workers support a leisure class? Are monopolistic and resources ants the real bad guys?
The 2025 trade and prices crisis, for Japan in particular, presents a new set of Ant-Grasshopper dilemmas. Which of the two best describes Japan of the company when it works on the tightrope between China and the United States? Which winter is looming in the global economy and the world order, is the better positioned arthropode? And that, as the lamentable agreements are discussed and the bad accommodation concluded, will investors decide to put their money?
Japan companies, for a few decades now, have tended to consider themselves proudly antisit – in many cases, actively celebrating its survivalist hoarding, its preparation and its propensity for rainy days for heavy toilets. His companies were mostly managed conservatively managed, in an preparation mentality for an unpertified crisis.
A cohort of investors has long considered it excessive. According to Goldman Sachs, more than half of the non -financial companies in the Topix index are in net cash and a majority has a net cash balance equivalent to more than 20% of their capital value. They are collectively seated on a mountain of other assets mainly trained from non -essential real estate and action portfolios in other listed companies. Investors have often grumbled on this subject, but the change in collective behavior was slow.
The money and the reserve, on several occasions, were king. Whenever winter has come, as it did in the form of the 2008 global financial crisis, the 2011 Tohoku earthquake and the 2020 pandemic, the relative financial robustness of Japanese companies was cited as a justification for anti -end. They survived, just like philosophy.
The particular gloom of this possible financial winter, however, could expose Japan as a behavioral animal. The breakdown of globalization, the decrease in the reliability of Washington as an ally, the accelerated decoupling of American Chinese China to hit Japan hard and force it to destructive choices. There was no signal that Japan will be spared heavy prices on cars, which means that any general economic slowdown will strike even stronger.
But as the acuity of the current danger has become simpler, the same is true for the argument that Japan has spent the last 20 years as a grasshopper disguised as an ant – wasting the opportunities offered by ultra -basic interest rates, poorly demanding domestic investors, more abundant and various cycles of government stimulus.
Despite years of investors' sweat, Japanese companies are entering this winter, and therefore less easy to support. Research by Shrikant Kale, a quantitative strategist at Jefferies, found that last year that the average Japanese company was exposed to 2.4 different industrial sectors, against 1.5 for American and European peers.
Corporate Japan should have consolidated its very fragmented industries earlier to create truly formidable world champions, fed a generation of professional financial directors to better manage assessments, digitizing earlier, lifting equity yields and was fighting to repair as optimal capital allocators when it could. Companies danced, in other words, when there was work to do.
Some, including Andrew McDermott, a long -standing investor in Japan and Mission Value Partners president, are convinced that Japan has discreetly done enough ants to prosper. Japanese companies, he underlines, are now better placed to build things in the United States than many American peers, which have moved 4 million jobs in the United States, even though the Japanese have created almost 1 minute (mainly manufacturing).
But the urgency with which the Japanese government simultaneously presss businesses for digital transformation, consolidation and higher corporate governance standards suggest that Tokyo now sees more locust than ants.
In 1934, when the New Deal began to approach the pricing debacle of Smoot-Hawley and the miseries of depression, Walt Disney reproduced The anti-grasshopper fable like a cartoon. In a final that Japan can now need to reproduce, the ants are nourishing the grasshopper in exchange for a winter of entertainment based on remorse and violin -based. “I was a fool all year round … You were right and I was wrong,” he grasped.
